Nogger's Blog

07/10/14 -- EU grains ended a choppy session mixed. London wheat jumped out of the starting stalls aggressively, trading GBP3.50/tonne higher in early trade, before quickly retreating into the red, but finally closing modestly higher.

The day ended with Nov 14 London wheat up GBP1.00/tonne to GBP114.50/tonne, Nov 14 Paris wheat closed EUR2.50/tonne higher at EUR162.75/tonne, Nov 14 Paris corn was down EUR0.25/tonne to EUR143.75/tonne, whilst Nov 14 Paris rapeseed was EUR0.50/tonne firmer at EUR330.75/tonne.

Informa Economics raised their estimate for the world wheat crop in 2014/15 to a record 726.1 MMT, up from a previous forecast of 722.1 MMT and up 1.7% versus last year. It is also 6.2 MMT higher than the USDA's September estimate.

Informa now see production in Europe this year at 153 MMT, up 3% from a year ago and 2.1 MMT more than where the USDA currently sit.

They raised their estimate for wheat production in Russia to 61 MMT, which is 2 MMT above the USDA, and a 17% jump versus 2013.

They also increased their outlook for the EU-28 corn crop this year from 70 MMT to 70.6 MMT, a more than 10% increase compared to a year ago and 2.3 MMT more than the USDA.

The Russian Ag Ministry said that this year's grain harvest had now surpassed the 100 MMT mark with more than 10% of the crop still to be harvested. They have output currently at 100.5 MMT off 89.3% of plan. Wheat accounts for 59.3 MMT of that total, off 90.2% of the planned area, with barley adding a further 20.6 MMT (off 95.4% of plan). The Russian corn harvest is approaching the halfway point at 47.8% done, producing a crop of 5.8 MMT so far.

Russian winter grain plantings (mostly wheat) for the 2015 harvest are already complete on 12.9 million hectares, or 78.2% of plan, they added. Progress has been brisk, only 8.7 million ha had been planted this time last year, aided by much drier conditions than 12 months ago. The newly planted crop could do with a drink to help it get established before winter sets in, but there's precious little in the 14 day forecast. The same could be said of Ukraine.

The USDA's FAS in Germany estimated the 2014 grain crop there at 52 MMT, up 8.8% on a year ago. That includes 27.5 MMT of winter wheat (+11.8%), 9.6 MMT of winter barley (+14.3%) and 4.7 MMT of corn (+6.8%).

ADAS said that the UK wheat harvest is 99% complete, with average yields this year at 8.4-8.6 MT/ha, around 10% higher than the preceding 5-year average. They said that the barley harvest is over, with the winter crop yielding 7.2-7.4 MT/ha (+14% versus the 10 year average) and the spring crop 6.0-6.3 MT/ha (+8%).

They pegged UK winter OSR yields at an average of 3.3-3.6 MT/ha, which is a bit better than the 10-year average of 3.3 MT/ha. The 2014 spring OSR crop is 90% harvested, with an average yield in line with the 5-year average at 2.0 MT/ha, they added.

For the 2015 harvest, winter OSR was 100% planted by mid-September, with winter wheat around 20% planted by the end of last month, and winter barley some 10% sown. Both those wheat and barley estimates sound a bit on the low side to me. There has been some flea beetle damage to newly planted winter OSR, with an estimated 3% of the crop lost to the pest, they said.